Tourist tax in Valencia and unregulated holiday homes

by Lorraine Williamson
tourist tax

VALENCIA – In some traditional Spanish sun and beach destinations, unregulated tourist accommodation is a growing problem, such as in the city of Alicante. Therefore, a tourist tax could be charged.

Around 40% of foreigners arriving in Spain spend the night in unregulated apartments or houses. This is apparent from comparative data from the survey of tourist movements at the borders (Frontur) and overnight stays by the National Institute of Statistics (INE). 

Trade associations in Benidorm, such as Hosbec, say this percentage is even higher in the case of national tourists. According to Hosbec, many Spaniards see illegal accommodation “as the first option” when planning their holidays. 

Campaigns against the problem of unregulated housing 

To end this problem of unregulated housing, the Valencian government has launched several campaigns. Firstly, an increase in fines to 600,000 euros in case of very serious violations. And secondly, to increase control, the number of inspectors was increased by five in the province. 

More than 5,000 new holiday homes were registered last year 

However, in practice, these measures appear to be far from sufficient in relation to the number of holiday accommodations in the region. In 2021, a total of 5,276 new tourist homes were registered in the Valencian Community, most (3,608, 68%) in the province of Alicante. 910 were registered in Valencia (17%) and 758 Castellón (15%). 

No tourist tax in registered accommodation 

All tourists staying in regulated accommodation will not have to pay the Valencian tourist tax in the proposal of the regional governing parties PSOE, Compromís, and Unidas Podemos. However, based on the text of the regulation that is now ready, all users of hotels, apartments, campsites, rural houses, and cruise ships will have to pay the tax. 

The paradox now is that in some destinations most tourists do not have to pay anything. In addition, those who are registered in the Valencian Community and who stay overnight in this region must also pay the tourist tax. 

Entrepreneurs object 

Tourism entrepreneurs have objected to the draft of the new tourist tax due to legal loopholes surrounding unregulated housing. Yet everything seems to indicate that it will be adopted without consensus. Employers, consumer groups, and even the regional secretary of tourism, Francesc Colomer, have spoken out against the tax. However, this did not stop the three aforementioned parties from pursuing their plans. 

Hit the wrong ones 

Nuria Montes, the general secretary of Hosbec, criticises that the proposal “taxes precisely those activities that generate employment and which already pay taxes”. Non-regulated persons and accommodations do not. “Based on the proposal, the tax rate promotes illegal housing, while governments should make an effort to eradicate this.” 

Reduced competitiveness 

All of this, according to business sources, “is diminishing the destination’s competitiveness at a key moment of rising prices due to inflation and rising supply and energy costs”, and “after the coronavirus pandemic that has largely shut down tourism for nearly two years.” .” 

Only Valencia supports tax 

It is currently unknown who will have to apply the tourist tax and to what extent. Until now, it would have been a tax levied by the autonomous region. Therefore, it is up to each municipality to activate it. Of all the tourist municipalities in the region, only Valencia, ruled by Compromís, has shown support for its implementation. 

How high will the tourist tax be? 

The newspaper El Español writes that the amount will be between €0.50 and €2.00. In principle, the scope will be voluntary and municipal. It is not known what the money collected with the tax will be used for. Until now, the idea has been that municipalities can choose what they want to invest in, including tourism promotion. 

Related post: Tourist sector against tourism tax

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